On Wednesday, November 22, 2017, the Government of Ontario passed Bill 148, the Fair Workplaces, Better Jobs Act, 2017. which now awaits Royal Assent. The passage of Bill 148 means that Ontario will see major changes to the Ontario Employment Standards Act, 2000 and Ontario Labour Relations Act, 1995 in the new year. These changes include moving to a $14 minimum wage (followed by a subsequent increase to $15 on January 1, 2019), increased vacation entitlements, increased entitlement to parental leave, paid emergency leave, and equal pay for part-time, contract and temporary employees.

On Wednesday, November 22, 2017, the Government of Ontario passed Bill 148, the Fair Workplaces, Better Jobs Act, 2017. which now awaits Royal Assent. The passage of Bill 148 means that Ontario will see major changes to the Ontario Employment Standards Act, 2000 and Ontario Labour Relations Act, 1995 in the new year. These changes include moving to a $14 minimum wage (followed by a subsequent increase to $15 on January 1, 2019), increased vacation entitlements, increased entitlement to parental leave, paid emergency leave, and equal pay for part-time, contract and temporary employees.

In Buterman v. St. Albert Roman Catholic Separate School District No. 734, 2017 ABCA 196, the Alberta Court of Appeal confirmed that the province’s human rights tribunal lacked jurisdiction to hear a human rights complaint due to the existence of a settlement agreement.

Facts

Jan Buterman was removed from the roster of substitute teachers maintained by the Board of Trustees of the Greater St. Albert Roman Catholic Separate School Board District No. 734 (the “Board”) because he was in the process of transitioning from female to male. Mr. Buterman filed a complaint with … Continue Reading

In Buterman v. St. Albert Roman Catholic Separate School District No. 734, 2017 ABCA 196, the Alberta Court of Appeal confirmed that the province’s human rights tribunal lacked jurisdiction to hear a human rights complaint due to the existence of a settlement agreement.

Facts

Jan Buterman was removed from the roster of substitute teachers maintained by the Board of Trustees of the Greater St. Albert Roman Catholic Separate School Board District No. 734 (the “Board”) because he was in the process of transitioning from female to male. Mr. Buterman filed a complaint with the Alberta Human Rights Commission against the Board alleging discrimination on the basis of gender and mental and physical disability (namely, gender identity disorder) contrary to the Alberta Human Rights Act.

In October 2009, the Board offered to settle the complaint for $78,000, in exchange for (1) a withdrawal of the complaint, (2) a covenant not to advance any further human rights complaints or legal process in relation to the complaint, and (3) a standard release containing a confidentiality clause (the “2009 Offer”). Mr. Buterman initially rejected that offer. However, in September 2010, Mr. Buterman (through his lawyer) indicated he was willing to accept the 2009 Offer. He requested that the Board confirm whether that offer remained open for acceptance, after which the parties could “discuss the details of the settlement.” The Board promptly advised that the 2009 Offer remained on the table and confirmed Mr. Buterman’s acceptance.

Later, following an exchange of correspondence over the wording of the release and confidentiality agreement, Mr. Buterman (through his lawyer) returned unsigned the draft settlement documents and the settlement money. Mr. Buterman subsequently made a statement to the media that he had rejected the Board’s settlement offer because of the confidentiality clause contained in the release.

Alberta Human Rights Tribunal (“Tribunal”) Decisions

The Board applied to the Alberta Human Rights Tribunal (the “Tribunal”) seeking a preliminary determination that the Tribunal had no jurisdiction to hear the complaint as a result of the settlement agreement. The Tribunal determined that the parties had entered into an executory contract of settlement (i.e., one not yet fully completed). It held that the parties had settled on September 8, 2010 and that they did not, through their subsequent correspondence, repudiate the agreement; they were merely working out the wording of the documents. The Tribunal added that it was up to the parties to “take the steps that will determine the way forward, whether that is to execute the settlement or otherwise”.

Following this decision, the Board sent Mr. Buterman a cheque for $78,000 and draft settlement documents. The Tribunal then issued a second decision in which it found it no longer had jurisdiction over the complaint because the settlement agreement had been fully executed (i.e., completed) and, as a result, Mr. Buterman had relinquished his complaint.

Alberta Court of Appeal (“Court”) Decision

Following an unsuccessful appeal to the Court of Queen’s Bench, Mr. Buterman appealed to the Alberta Court of Appeal. The Court upheld the Tribunal’s finding that the parties had reached a settlement agreement on September 8, 2010. It rejected Mr. Buterman’s argument that the agreement was invalid because there was uncertainty as to its “essential terms”. The Court upheld the Tribunal’s finding that the execution of the release and confidentiality agreement was an essential term, but the form of the document was not.

The Court also rejected Mr. Buterman’s submission that the Board had repudiated the settlement agreement in its post-agreement correspondence. It noted that the Tribunal had found the Board was receptive to amendments and that the parties were engaged in an exchange about the final wording of the documents. The Court added that in order for an agreement to be repudiated, the non-repudiating party must communicate acceptance of that repudiation. Here, although Mr. Buterman had communicated with the media, at no time did he communicate his acceptance of any alleged repudiation to the Board. In the result, the Court confirmed that, due to the settlement agreement, the Tribunal had no jurisdiction to hear the complaint.

Key Takeaways

A key takeaway from Buterman is that the formation of a settlement agreement must be distinguished from the completion of that agreement. Although the parties had not worked out the precise language to be included in the settlement documents at the time the employer had confirmed the acceptance of the earlier offer it had made, that did not preclude a finding that a settlement agreement had been formed at that moment. The “essential terms” of the agreement had been settled, and the parties’ subsequent communications over what the Tribunal took to be relatively inconsequential matters of wording did not change that fact. Accordingly, the mere fact that the parties continue to negotiate the terms of a bargain does not necessarily mean a legally binding agreement has not already been reached.

Despite the result in Buterman, employers must recognize that any attempt to settle a complaint or claim brought by an employee – or anyone else, for that matter – must be approached carefully. It is critical to ensure the “essential terms” of the agreement are nailed down; otherwise, the counterparty may attack the agreement on the basis that its terms are too uncertain to constitute a binding contract. Furthermore, post-agreement negotiations over the terms of the settlement – or “tinkering” with the agreement – may invite an argument that new terms have been added to the contract that were never the subject of agreement.

If you have any questions about settlement agreements or related issues affecting your business, do not hesitate to contact one of the members of our Labour and Employment group.

*This blog was written with the assistance of Connor Bildfell, Articling Student.

The interview process can be a legal minefield for employers. One false step, one inappropriate question can give rise to a human rights complaint alleging that the employer has discriminated against the prospective employee. In a recent decision, Jahromi v. Link2 Manufacturing and another, 2017 BCHRT 161 (“Jahromi”), the BC Human Rights Tribunal (the “Tribunal”) considered whether one employer’s interview questions crossed the line between permissible inquiry and outright discrimination.

Facts

Shawn Jahromi filed a complaint with the Tribunal alleging that Link2 Manufacturing and the Link2 employee who interviewed him discriminated against … Continue Reading

The interview process can be a legal minefield for employers. One false step, one inappropriate question can give rise to a human rights complaint alleging that the employer has discriminated against the prospective employee. In a recent decision, Jahromi v. Link2 Manufacturing and another, 2017 BCHRT 161 (“Jahromi”), the BC Human Rights Tribunal (the “Tribunal”) considered whether one employer’s interview questions crossed the line between permissible inquiry and outright discrimination.

Facts

Shawn Jahromi filed a complaint with the Tribunal alleging that Link2 Manufacturing and the Link2 employee who interviewed him discriminated against him on the basis of his family status, ancestry, place of origin, and race. Mr. Jahromi’s complaint arose out of a series of events occurring during his Link2 job interview. According to Mr. Jahromi, the interviewer asked where he was from, where his parents were from, and if he lived with his family (the “Questions”). He said these Questions made him feel “uncomfortable” and he felt pressured to respond.

The interviewer neither confirmed nor denied whether she asked Mr. Jahromi these questions. However, the interviewer recalled asking Mr. Jahromi how to pronounce his last name, so as to ensure she was pronouncing it correctly, as a matter of respect.

In the end, Mr. Jahromi did not get the position; another candidate was hired. Mr. Jahromi alleged he did not get the job because of his responses to the Questions, which related to his family status, ancestry, place of origin, and race. The Respondents denied the allegations, maintaining that Mr. Jahromi was not hired because of his high and inflexible wage expectations and because his professional experience and education did not meet their expectations. They also said the successful candidate was more qualified and performed better during the interview process.

The Tribunal’s Decision

In assessing the threshold question of whether Mr. Jahromi’s claim had a reasonable chance of success, the Tribunal observed that, unlike its counterpart in Ontario, the BC Human Rights Code does not contain a provision expressly prohibiting the asking of interview questions regarding protected characteristics, such as family status or disability. In Ontario, simply asking such questions is impermissible, even absent an intention to discriminate or evidence that the answers were in fact used to discriminate. The Tribunal noted that in BC, by contrast, whether questions regarding protected characteristics are discriminatory will depend on the context. The Tribunal summarized the law as follows:

[26] … in British Columbia, in the course of an employment interview, a question in relation to a personal characteristic is not expressly prohibited, but may be discriminatory, depending on the context. As in all Canadian jurisdictions, a discriminatory motive is not necessary. Rather, it is the effect that matters.

Turning to the application of this principle, the Tribunal noted that Mr. Jahromi had not identified his personal characteristics in relation to his family status, ancestry, place of origin, or race. Although Mr. Jahromi claimed that the questions asked of him were “illegal” and that he felt “uncomfortable” answering them, the Tribunal could not, without more, find that his claim had a reasonable prospect of success.

The Tribunal was quick to clarify, however, that this did not mean these sorts of questions could never be discriminatory. Rather, the conclusion in Jahromi was based solely on the “dearth of relevant information” presented by Mr. Jahromi regarding his protected characteristics. In the result, the complaint was dismissed.

Key Takeaways

Jahromi emphasizes that, at least in BC, when assessing whether interview questions touching upon a personal characteristic protected under the Code may constitute discrimination, context is king: the same question found to be discriminatory in one context may be perfectly permissible in another. Although questions touching upon protected characteristics – such as where the interviewee is from – may be an ordinary part of “small talk” arising naturally in the course of conversation, employers must remain mindful of (i) the types of questions they ask, particularly where a question may yield information about a protected characteristics, and (ii) the use they make of such answers when deciding whether or not to hire the candidate.

The Tribunal cited the following passage from Mbaruk v. Surrey School District No. 36, [1996] B.C.C.H.R.D. No. 50, which provides useful guidance to employers:

[59] The Act does not prohibit the mere asking of questions that touch in some way on a prohibited ground of discrimination. In my view it was not the intent of the legislature to impose such limits on employment interviewers that they are paralysed from engaging in normal social conversation out of fear that they may violate the Act by alluding to some matter which touches on a prohibited ground of discrimination. That does not mean interviewers need not be concerned with the content of their questions. They should be sensitive to the person they are interviewing and avoid questions that may be perceived as offensive. They should also avoid asking questions that may elicit information that could be used to discriminate on a prohibited ground unless they have a lawful requirement for that information.

If you have any questions about the law governing the interview process or related issues affecting your business, do not hesitate to contact one of the members of our Labour and Employment group.

*This blog was written with the assistance of Connor Bildfell, Articling Student.

A recent decision from the Manitoba Court of Queen’s Bench supports that an employee’s use of his work phone to secretly record meetings with management may support an employer’s decision to terminate for just cause.

In Hart v. Parrish & Heimbecker, Limited [Hart], the plaintiff, Mark Hart, sued his former employer for wrongful dismissal after he was terminated for cause following a series of employee complaints against him. In the course of the litigation, Mr. Hart tendered as evidence recordings of conversations he had had with the defendant’s management personnel in the course of the … Continue Reading

A recent decision from the Manitoba Court of Queen’s Bench supports that an employee’s use of his work phone to secretly record meetings with management may support an employer’s decision to terminate for just cause.

In Hart v. Parrish & Heimbecker, Limited [Hart], the plaintiff, Mark Hart, sued his former employer for wrongful dismissal after he was terminated for cause following a series of employee complaints against him. In the course of the litigation, Mr. Hart tendered as evidence recordings of conversations he had had with the defendant’s management personnel in the course of the defendant’s investigation into the employee complaints, which the defendant was not aware of at the time of dismissal. During the course of the litigation, in addition to its reliance on Mr. Hart’s conduct with respect to the employee complaints as just cause for dismissal, the defendant employer also alleged after-acquired cause based on the surreptitious recordings. The defendant submitted the recordings amounted to a breach of confidentiality and trust and of the personal code of conduct Hart had created following employment counseling sessions.

With respect to the complaints made against Mr. Hart – which were generally concerned with Mr. Hart’s unprofessional, rude and aggressive conduct at work – the court found that the complaints were serious and amounted to breaches of the defendant’s employee handbook and its anti-harassment policies. The court concluded that the defendant had addressed the complaints appropriately with Mr. Hart, coached him on appropriate workplace behaviour, sent him for professional workplace counseling when matters escalated and otherwise conveyed to Mr. Hart that improvement was necessary or consequences would follow. The court found that the defendant’s failure to specifically warn Mr. Hart that he would be dismissed if his conduct did not improve was not fatal to the employer’s reliance on just cause. As the court put it:

…it is not necessary to specifically warn an employee that he/she will be dismissed if certain objectionable behaviour occurs again, where a reasonable person would know or ought to know that the conduct is inappropriate, contrary to the defendant’s policies and may result in termination.

With respect to Mr. Hart’s secret recording of meetings, the court agreed that Mr. Hart had breached his confidentiality and privacy obligations to the defendant and that the recordings also amounted to a breach of the “personal code of conduct” that Mr. Hart had prepared following his employment counseling. While the court accepted that Mr. Hart’s secret recordings amounted to a breach of his employment obligations and were properly considered pursuant to the doctrine of after-acquired cause, this misconduct was simply a factor in the contextual assessment of just cause and the court considered that Mr. Hart’s misconduct at the time of dismissal was sufficient to establish just cause.

This case is a positive one for employers for a number of reasons.

With respect to the employee complaints and the employer’s response, it supports that a formal warning of potential termination is not necessary if the circumstances are such that an employee ought to know what is expected and the consequences that may follow for falling below the expected level of workplace behaviour.

Secondly, the case recognizes the obligations of employees to make appropriate use of phones at work, which may include not secretly recording management meetings, and that this form of misconduct may contribute to an employer’s conclusion that it has just cause for dismissal, even if discovered after termination.

Thirdly, the case is a good reminder to review and update your workplace policies to ensure they restrict employees’ use of work phones to appropriate conduct. Given the ubiquity of personal or workplace phones with recording capabilities, the reminder and potential restriction on misuse of such devices that emanates from the court’s decision in Hart is a helpful one.

If you have any questions regarding the use of phones in the workplace, appropriate workplace policies regarding the same or the scope of response to an employee’s misuse of a phone while at work, do not hesitate to contact a member of our Labour and Employment Group.

Genes are the building blocks of life, shaping our physical traits, personal characteristics, and our biological make-up, and the field of genetic testing and mapping is advancing rapidly. With a simple cheek swab, health care professionals can now often predict whether an individual is predisposed to developing a particular disease or medical condition.

While such scientific advances can enable individuals to take proactive steps to avoid adverse health consequences, genetic testing also brings with it the risk that individuals may be discriminated against on the basis of the personal information within their genetic codes, either in the … Continue Reading

Genes are the building blocks of life, shaping our physical traits, personal characteristics, and our biological make-up, and the field of genetic testing and mapping is advancing rapidly. With a simple cheek swab, health care professionals can now often predict whether an individual is predisposed to developing a particular disease or medical condition.

While such scientific advances can enable individuals to take proactive steps to avoid adverse health consequences, genetic testing also brings with it the risk that individuals may be discriminated against on the basis of the personal information within their genetic codes, either in the workplace, in the context of insurance policies, or elsewhere. Furthermore, the concern with potential genetic discrimination may dissuade individuals from undergoing genetic testing, sacrificing a valuable opportunity to discover a potential health risk and take appropriate steps to mitigate it.

The Genetic Non-Discrimination Act

On the basis of these concerns, the Canadian government recently enacted the Genetic Non-Discrimination Act, S.C. 2017, c. 3 (the “Act”), which came into force on May 4, 2017.

The Act ushers in three significant changes aimed at eliminating discrimination based on genetic characteristics in Canada:

Prohibition against genetic testing conditions in agreements

The Act prohibits persons other than health care practitioners and medical researchers from requiring an individual to undergo a genetic test or disclose the results of a genetic test as a condition of:

a. providing goods or services to that individual;

b. entering into or continuing a contract or agreement with that individual; or

c. offering specific conditions in a contract or agreement with that individual.

Although this aspect of the Act is cast in broad and general terms, concerns have been expressed that this prohibition is an unconstitutional attack on the insurance industry (which is a matter falling within provincial jurisdiction) and will likely be tested in court.

The Act adds new provisions to the Code, prohibiting employers from requiring employees to undergo or to disclose a “genetic test”, defined as “a test that analyzes the employee’s DNA, RNA or chromosomes for purposes such as the prediction of disease or vertical transmission risks, or monitoring, diagnosis or prognosis”, or from taking any disciplinary action against an employee:

a. because the employee refused a request to undergo a genetic test;

b. because the employee refused to disclose the results of a genetic test; or

c. on the basis of the results of a genetic test.

Employers are also prohibited from collecting or using the results of a genetic test without the written consent of the employee, and third parties are prohibited from disclosing the results or existence of a genetic test to an employer without the employee’s written consent.

3. New prohibited ground of discrimination added to Canadian Human Rights Act (“CHRA”)

Finally, the Act adds to the CHRA the new prohibited ground of “genetic characteristics”. Though “genetic characteristics” is not defined, the Act includes a provision clarifying that, where the form of discrimination is based on the refusal of a request to undergo a genetic test or to disclose the results of a genetic test, the discrimination shall be deemed to be on the ground of genetic characteristics. This clarification was made, at least in part, in response to concerns that the term “genetic characteristics” might be interpreted in an overly broad manner, as almost any trait could be considered to be based, at least to some degree, on genetics. However, it will be up to the Canadian Human Rights Tribunal to further delineate the scope of discrimination in connection with the new ground of “genetic characteristics”.

The changes introduced by the Act bring Canada in line with all other G7 nations. The full scope of their impact on workplaces in Canada remains to be seen. We will continue to monitor the consequences created by the Act and keep you abreast of relevant developments. If you have any questions about how the new requirements and prohibitions discussed above may affect your business, do not hesitate to contact one of the members of our Labour and Employment group.

Restrictive covenants are often a key component of employment agreements and commercial transactions. Enforceability, however, can be challenging, especially in the employment context. The B.C. Court of Appeal’s recent decision in IRIS The Visual Group Western Canada Inc. v. Park, 2017 BCCA 301, is a good reminder and provides valuable insight into several related legal principles. The implications of the decision will be of interest to many B.C. employers who rely on restrictive covenants or who are contemplating doing so.

Restrictive covenants are often a key component of employment agreements and commercial transactions. Enforceability, however, can be challenging, especially in the employment context. The B.C. Court of Appeal’s recent decision in IRIS The Visual Group Western Canada Inc. v. Park, 2017 BCCA 301, is a good reminder and provides valuable insight into several related legal principles. The implications of the decision will be of interest to many B.C. employers who rely on restrictive covenants or who are contemplating doing so.

Background

IRIS The Visual Group Western Canada Inc. (“IRIS”), an eye care services provider and eyewear products vendor, operated its business by entering into Optometric Services Agreements (“OSAs”) with individual optometrists to deliver its services and products to customers. IRIS concluded such an agreement with a certain Dr. Park. In the agreement, Dr. Park agreed and acknowledged she would provide services as an independent contractor. The agreement also included a non-competition clause that prohibited Dr. Park from competing with IRIS, whether directly or “in partnership or in conjunction with” any person or company “carrying on, engaged in, interested in or concerned with a business that competes with” IRIS within 5 km of the IRIS location in Vernon where Dr. Park provided services. The clause also prohibited Dr. Park from being “engaged” or “employed” by any competing persons or companies, subject to the same temporal and geographic constraints.

Dr. Park eventually resigned in order to set up her own practice. She requested that IRIS release her from the non-competition clause, but IRIS refused. She proceeded to set up her own practice nonetheless, about 3.5 km from the IRIS location where she previously worked. IRIS then brought an action against Dr. Park seeking a declaration that the non-competition clause was valid and enforceable, and for an injunction preventing her from competing with IRIS within 5 km of its Vernon location.

B.C. Supreme Court Decision

At trial, the B.C. Supreme Court found that because the non-competition clause was a restrictive covenant, the onus was on IRIS to show the restriction was reasonable as between the parties. The judge determined that the OSA was closer to an employment contract than an agreement to sell a business, and accordingly gave the agreement the closer scrutiny that employment relationships attract. The judge concluded that the temporal and geographic limitations were reasonable, but that the clause was overly broad in terms of the activities it proscribed. Accordingly, the judge declined to enforce the clause. IRIS appealed.

B.C. Court of Appeal Decision

Three issues were raised on appeal:

Did the trial judge err in characterizing the OSA as an “employment agreement” and consequently scrutinizing the agreement more rigorously?

Did the trial judge err in finding the non-competition clause was unreasonable in terms of the scope of activities it prohibited?

If the non-competition clause was unreasonable as drafted, did the trial judge err in declining to use the “blue-pencil rule” to make the clause reasonable?

(1) Heightened Scrutiny Test

The Court of Appeal affirmed that agreements containing the elements of an employment relationship – namely, the absence of a payment for goodwill and a power imbalance between the parties – warrant greater scrutiny, as compared to agreements for the sale of a business. Although Dr. Park had been characterized as an “independent contractor” in the agreement, that characterization did not shelter the agreement from stricter scrutiny, as there was no goodwill payment and there was a power imbalance between the parties favouring IRIS. In finding there was a power imbalance, the Court cited the fact that IRIS set Dr. Park’s hours, controlled her vacation time, set the fees she charged, and required that all patient files be transferred to another IRIS optometrist upon termination of the OSA. The Court also noted Dr. Park’s relative inexperience and lack of client base, factors that further suggested a power imbalance. Accordingly, the Court concluded it was appropriate to give the non-competition clause rigorous scrutiny.

(2) Scope of the Non-Competition Clause

The Court affirmed that IRIS bore the onus of demonstrating that the non-competition clause was cast no more broadly than necessary to protect the legitimate interests of the company, the key interest here being IRIS’s trade connections. The Court noted that in addition to a non-competition clause, the OSA had included a non-solicitation clause and a provision requiring Dr. Park to transfer her client list and files to another IRIS optometrist upon her departure. Both of these provisions provided some protection for IRIS’s trade connections. In the main, however, there were two key issues with the non-competition clause that made it unreasonable:

First, the clause was ambiguous. The Court wondered what it meant to compete “in conjunction with” another person, as well as how one would determine whether an individual was “concerned with” a competing business.

Second, the clause went beyond what was necessary to protect IRIS’s legitimate interests. If enforced, the clause would prevent Dr. Park from engaging in a wide range of work, including work that had nothing to do with the practice of optometry, such as working with a business that dispenses non-prescription eyeglasses or sunglasses.

Accordingly, the Court concluded that the non-competition clause was not reasonable, in so far as it was ambiguous and overly broad, and therefore was not enforceable.

(3) Severability

Finally, the Court considered IRIS’s argument that the non-competition clause could be salvaged by employing the “blue pencil rule” or “blue-pencil severance”. IRIS argued that the court should give effect to the parties’ intentions and should make the restriction reasonable by striking out part of the clause to narrow the list of prohibited activities to working with a business that dispenses prescription optical appliances. The Court noted that courts are disinclined to fix defective non-competition clauses by severing offending language. It was confirmed that courts will have recourse to blue‑pencil severance only in cases where the part being removed is “clearly severable, trivial and not part of the main purport of the restrictive covenant”. In IRIS, the court found that blue-pencil severance could not be performed for two reasons:

First, trimming the clause in the manner suggested by IRIS would go to the “main purport” of the restrictive covenant, as the company had clearly intended to prevent Dr. Park from competing with it in any way, however remotely. The Court found it would be inappropriate to effectively rewrite the agreement to create a more moderate restriction that did not reflect the parties’ intentions.

Second, the Court noted that the “fix” suggested by IRIS would not resolve the ambiguity created by words of association such as “in conjunction with” or “concerned with a business”.

Accordingly, the Court declined to perform blue-pencil severance.

Key Takeaways

There are at least three key lessons that B.C. employers can take away from this case:

An independent contractor agreement will likely be subject to the same degree of scrutiny as an employment agreement. IRIS makes clear that courts will focus on whether the policy rationale for the strict scrutiny given to employment agreements – arising from a power imbalance and the absence of a goodwill payment – is present. If the policy rationale exists, strict scrutiny will follow. IRIS also provides some indication of the sorts of factors that courts may consider when determining whether an imbalance of power exists in cases involving professionals. These factors include the professional’s experience, the level and depth of client base at the time the agreement is entered into, the professional’s ownership and/or control over the client relationships and files, and the employer’s level of control over matters such as working hours, vacation time, and billing rates. Many other factors may also be considered.

Employers must take great care to ensure any restrictive covenant goes no further than is necessary to protect the legitimate interests of the company. This means ensuring, among other things, that the restriction is clear and appropriately constrained in terms of the scope of activities restricted, the length of time during which the restrictions operate, and the geographical scope of those restrictions. In terms of clarity, the Court of Appeal in IRIS emphasized at several points in its decision that the words “in conjunction with” and “concerned with” a business were ambiguous in meaning. This is somewhat surprising given that those terms are likely found in many agreements. It also shows that courts have wide latitude in interpreting restrictive covenant language and can easily take issue with a covenant. Accordingly, in addition to ensuring that the covenant is not overly or unnecessarily restrictive, employers should pay close attention to the language they use – plain language is beneficial.

Courts are reluctant to resort to blue-pencil severance to salvage a defective non-competition clause. Unless it can be demonstrated that the part sought to be removed is clearly severable, trivial, and not part of the “main purport” of the clause, the court will not consider striking portions to make the restrictive covenant reasonable. Hence, it is essential that employers “get it right the first time” and draft an unambiguous, reasonable restriction.

Given the challenges that this area presents, employers are also well advised to seek legal advice on restrictive covenants, especially if such protections are very important to the business.

*This blog was written with the assistance of Connor Bildfell, Articling Student.

In August, I posted about Premier John Horgan’s announcement of the Government’s intent to re-establish a human rights commission. The intent of this new human rights commission will be to act proactively to address systemic discrimination and inequality in British Columbia.

The Government is now engaged in consultation with stakeholders and citizens, which will include online discussions with Parliamentary Secretary Ravi Kahlon, as well as in person meetings. If you would like to share your views on the role, functions and priorities of the new human rights commission, you can do so any time before November 17, … Continue Reading

In August, I posted about Premier John Horgan’s announcement of the Government’s intent to re-establish a human rights commission. The intent of this new human rights commission will be to act proactively to address systemic discrimination and inequality in British Columbia.

The Government is now engaged in consultation with stakeholders and citizens, which will include online discussions with Parliamentary Secretary Ravi Kahlon, as well as in person meetings. If you would like to share your views on the role, functions and priorities of the new human rights commission, you can do so any time before November 17, 2017 at 4 pm. For more information on how to participate in the consultation process and to sign up to receive updates about this process, visit the B.C. Human Rights Commission webpage HERE.

If you have any questions about Bill 148 and how it will impact your workplace, please do not hesitate to contact us, Tim Lawson, Matthew Demeo or any lawyer in our Ontario Labour and Employment Law group.

]]>http://www.bcemployerlaw.com/2017/09/12/update-on-ontarios-employment-and-labour-law-reform-bill/feed/0British Columbia Supreme Court rules on reasonable notice when an employee is terminated before their first day of workhttp://www.bcemployerlaw.com/2017/09/06/british-columbia-supreme-court-rules-on-reasonable-notice-when-an-employee-is-terminated-before-their-first-day-of-work/
http://www.bcemployerlaw.com/2017/09/06/british-columbia-supreme-court-rules-on-reasonable-notice-when-an-employee-is-terminated-before-their-first-day-of-work/#respondWed, 06 Sep 2017 14:00:49 +0000http://www.bcemployerlaw.com/?p=3177By Monique Ronning

In Buchanan v. Introjunction Ltd., 2017 BCSC 1002, the Court considered a case where the employer terminated the plaintiff’s employment before he commenced work. The Court rejected employer’s argument that the probation period clause applied to limit its liability to provide notice of termination of employment. Despite the contractual termination provisions in the employment agreement, the Court awarded the plaintiff common law reasonable notice. It is important that employers take note of the legal principles in this case if they plan to retract an offer of employment.

In Buchanan v. Introjunction Ltd., 2017 BCSC 1002, the Court considered a case where the employer terminated the plaintiff’s employment before he commenced work. The Court rejected employer’s argument that the probation period clause applied to limit its liability to provide notice of termination of employment. Despite the contractual termination provisions in the employment agreement, the Court awarded the plaintiff common law reasonable notice. It is important that employers take note of the legal principles in this case if they plan to retract an offer of employment.

Background

On October 16, 2017, Colton Buchanan accepted an offer of employment from Introjunction and signed a contract of employment. Expecting to commence work on November 1, 2016, Mr. Buchanan quit his existing job. Unfortunately, after he quit, on October 29, 2016, Introjunction’s CEO informed Mr. Buchanan that the offer of employment was being retracted. Mr. Buchanan commenced an action for wrongful dismissal, seeking four months’ pay in lieu of notice of termination of his employment.

Probationary Period Clause

It is well-established that where an employee is terminated before they start work, they are entitled to reasonable notice or payment in lieu of notice (see, for example, DeGagne v. City of Williams Lake, 2015 BCSC 816). However, Introjunction argued that this principle did not apply because Mr. Buchanan’s employment contract contained a three-month probationary period, and it could rely on the probation provision in the circumstances. The Court disagreed, finding that: (i) the probation period expressly commenced on November 1st; and (ii) even if the probation provision did apply, it required the employer assess the suitability of the employee for the role during the probation period prior to terminating the employee’s employment. As Introjunction had terminated Mr. Buchanan’s employment before he started work, the probation period was not engaged and suitability could not have been a factor in the decision to terminate his employment.

Anticipatory Breach

The Court also found that Introjunction’s conduct demonstrated a clear intention to not honour the employment contract when it retracted the offer of employment before he commenced his employment (it is important to this finding that Mr. Buchanan had already accepted the offer). As a result, Introjunction’s “retraction” of the employment offer amounted to a repudiation of the contract and an anticipatory breach. Accordingly, having repudiated the contract, Introjunction could not rely on any provision in the contract, and it was thus subject to the common law obligation to provide reasonable notice of termination of the contract of employment.

Summary

Ultimately, the Court found that Introjunction wrongfully dismissed Mr. Buchanan from his employment and awarded him six weeks’ pay in lieu of notice.

This result is an important reminder to employers about the potential risks of rescinding an offer of employment after it is accepted, and that caution should be exercised when terminating an employment agreement in such circumstances. Even with no service, and employee may attract a reasonable notice award. In this case it was six weeks, but considering the courts analyze a number of factors in assessing reasonable notice, other cases could involve even longer notice awards. These risks can be mitigated by including carefully drafted contractual termination provisions. Please contact us if you would like further information.